Apartment availability hits a low

Apartment sales in Prague dropped during the summer months compared the same time last year. Some 1,447 apartments were sold between July and the end of September, according to statistics from developer Ekospol. At the same time, the supply of new apartments has also fallen.

The third quarter of 2016 showed a drop of 14.6 percent year-on-year and a drop of 27.6 percent compared to the second quarter of 2016. While the summer months are traditionally slow, real estate experts also blame the city authorities. The number of apartments available on the market is at a historic low. Ekospol CEO Evžen Korec said the situation is due to the current permitting process, which makes it difficult for developers to add new projects to the market. Small and medium-size firms, which only added a negligible amount of new apartments to the market, are the most affected.

Developers point out that people interested in new flats are in a worse position than a year ago, as the supply of new flats has fallen by 2,300 units since the previous year. At the end of September developers had only 4,097 affordable apartment units listed, which is the lowest amount in the past decade. From July to September some 1,000 new apartments were added, which is fewer than the 1,447 that were sold. The amount of available apartments has fallen steadily since the second quarter of 2015, when some 7,000 flats were available. In the third quarter of 2015, some 6,400 flats were available.

Eksopol's Korec said that the limited supply of affordable apartments makes it difficult to take advantage of the economic recovery and relatively low mortgage rates. Attractive apartments are bought almost as soon as they hit the market, leaving behind long-unsold flats that are much less desirable, he said.